BRICS bank boon for African devel­op­ment

The FirsT re­GioNal CeN­Tre of the BRICS bank will sup­port devel­op­ment across the African con­ti­nent.

The African branch of the BRICS New Devel­op­ment Bank opened in Jo­han­nes­burg re­cently.

Head­quar­terd in Shang­hai, China, the African of­fice will iden­tify and pre­pare pro­pos­als for African projects that would qual­ify for fund­ing from the bank.

Pres­i­dent Ja­cob Zuma said the es­tab­lish­ment of the African of­fice an im­por­tant mile­stone for Africa as well as South Africa. He was joined at the launch in Sand­ton by the bank’s pres­i­dent Kun­da­pur Va­man Ka­math.

The bank, Pres­i­dent Zuma ex­plained, has been man­dated to fund African in­fra­struc­ture, es­pe­cially in the ar­eas of en­ergy, trans­port and the wa­ter. This fund­ing will help un­lock the growth po­ten­tial of the con­ti­nent, the pres­i­dent be­lieves.

“African coun­tries gen­er­ally do not have ad­e­quate in­fra­struc­ture in­ter­con­nec­tions. As a re­sult, we can­not max­imise the ben­e­fits of re­gional trade. Worse still, the con­ti­nent does not have ad­e­quate so­cial in­fra­struc­ture for the pro­vi­sion of ba­sic ser­vices such as health and ed­u­ca­tion, and we there­fore are not able to sig­nif­i­cantly im­prove the liv­ing stan­dards of our peo­ple.”

Fos­ter­ing devel­op­ment

The World Bank es­ti­mates that there is a $100 bil­lion a year fund­ing short­fall for in­fra­struc­ture projects in Africa. The short­age, es­pe­cially for power gen­er­a­tion projects, has re­strained in­dus­trial growth across the con­ti­nent.

Pres­i­dent Zuma be­lieves the bank’s role should be more than meet­ing the fund­ing needs of African projects. The bank should be­come a cen­tre of ex­cel­lence to build ca­pac­ity and share knowl­edge across the con­ti­nent.

It should “…fos­ter the devel­op­ment of mem­ber coun­tries, sup­port eco­nomic growth, pro­mote and fa­cil­i­tate job cre­ation and to build a knowl­edge shar­ing plat­form among de­vel­op­ing coun­tries”.

The set­ting up of the bank was an­nounced in 2014 at a BRICS Sum­mit in Brazil. It was es­tab­lished to meet the spe­cific devel­op­ment needs of the global south. At the time, Ka­math said: “Our ob­jec­tive is not to chal­lenge the ex­ist­ing sys­tem as it is but to im­prove and com­ple­ment the sys­tem in our own way.”